Relationship Management in Starbucks Corporation - Research Proposal Example

Abstract Relationship management is one of the most important components of a business reaching a level of success. The ability to create relationships is dependent on several levels of working with others and establishing the necessary relationships. The Starbucks Corporation is an example of how relationships can make a difference in the success of the company, specifically when it applies to working with various stakeholders that are involved in the corporation. The components that are established as a part of the corporation are identified with the several layers of relationships established as well as the communication which can be used to further build Starbucks through the trust and loyalty which can be established with specific relationships. Table of Contents Introduction………………………………………………………………………………..3 Literature Review………………………………………………………………………….3 What Is Relationship Marketing…………………………………………………..3 Reasons for Development of Relationship Marketing…………………………….6 Case: Starbucks……………………………………………………………………………8 Problem……………………………………………………………………………9 Strategy Used…………………………………………………………………….10 Issues with Strategy……………………………………………………………...11 Approach…………………………………………………………………………11 Tactics……………………………………………………………………………13 Conclusion……………………………………………………………………………….14 References………………………………………………………………………………..15 Introduction The ability to form relationships within a given organization makes a difference in how many respond to the growth of a corporation. Developing a specific market, defining different stakeholder groups and establishing relationships can ensure a stronger response for the corporation while leading to growth. More important, this can provide a stronger target market and better relationship marketing among others that are not directly influenced by the stakeholder agreements (Chiu et al, 2005: 1681). One of the corporations which can be looked at in terms of relationship marketing is Starbucks. This particular organization is known for the strong amount of growth it has had since its inception as well as specific marketing tactics that have allowed it to remain defined among other coffee shops that are located on a global basis. Defining both the strengths of this organization, as well as the strategies and tactics which can be used to further the development of this corporation can change the overall functioning of the corporation (Chiu et al, 2005: 1681). Literature Review What is Relationship Marketing While Starbucks has quickly led to a significant, global growth, there are also other areas of examination with the relationship marketing which can be used for the company. The concept of relationship marketing has quickly expanded into a vast field of understanding the mechanics between different levels of business. The specific focus is on relationships between the company as an entity and relationships with customers, businesses and sectors which interact with the company. It is known that the more in which these relationships are established, the easier it is to create psychological responses within the community while fostering the growth of those that are interested in the specific market. More important, the relationship is one which is determined by the strategies, tactics, internal organization and the pricing considerations that are associated with a business. For a company to work toward success there is the need to monitor and offer different levels of relationship marketing that are able to support and enhance the business in an alternative manner (Bruhn, 2001: pg. 4). For the concept of relationship marketing to work effectively, there is the need to identify strategies that are incorporated into the business. There are specific models which have been established, specifically to define the market, relationship values which should be created and the responses that occur to companies through this model (Peck, 1999: pg.2). An example is the Six Markets model, which looks at various markets and how they influence the overall corporation. This includes markets that are internal, referred, influential, recruited, and from suppliers and alliances. Each of these directly affects the way that the market responds as well as the overall success which an organization holds. If the organization has bad relationships in one area, then word of mouth and other concepts related to the reputation of the company will directly alter and influence their ability to expand and grow within the market. The result is that the relationships and values are required to change or build a different strategy, all which affects the six different areas that are a part of the main model (Peck, 1999: pg. 2). The definition of the multiple markets then leads to different virtues and expectations that are associated with various corporations. To build the relationships among various individuals, it is first required to build a sense of loyalty and trust to those involved with the corporation. It has been found that these two qualities have the ability to alter the platform that is within the various markets (Battacharya et al, 2005, pg. 574). The inter-personal and inter-organizational concepts first have to link to these specific attributes. This can be followed by the reflection which this has to those who are interested in the corporations as well as the loyalty and trust that is among those who are in the corporation. The main concept which applies to the trust which is incorporated into the corporations is dependent on the amount of dependence which one has over an organization as well as how reliable that corporation is with delivering the needed products to gain the trust. As this is done, a deep interdependence is created, which leads to both trust and loyalty of the different customers (Mouzas, Henneberg, Naude, 2007, pg. 1018). While the concept of trust and loyalty is essential for those that are in corporations, there is also an exchange of dynamics that differ between various types of organizations and the expectations that are associated with the company. For instance, the relationship between buyers and sellers is known to carry a more selfish impact between the two individuals (Gummesson, 2008, pg. 67). The main motivator of those who are buying is to take the products or services of the corporation and to build a specific means of associating with the company. More important, the main driving force of a business is to build into the competition that is a part of the company and to move ahead of others in the work force, which creates a different set of values and approaches that are associated with the corporation. The cooperative relationships then have objectives for those involved to take advantage of opportunity and to care for specific expectations that are a part of the work force. In the past, it was expected that those in the work force would only meet for a basic exchange of products, services or ideas then would have to move to a different competition. However, recent studies (Palmer, 2002) have showed that the ability to build continuous relationships is one that requires alternative approaches that are outside of the selfishness which many corporations have made a part of the internal environment (Palmer, 2002: pg. 24). Reasons for Development of Relationship Marketing To change the different qualities of both organizations and responses from the market is the need to begin the changes with employees and company goals. By doing this, there is the ability for the corporation to excel and to have a stronger basis for development of the company. It has been found that the internal organization can alter the way that relationships are built as well as the expectations for the company to begin to thrive in a competitive environment. More important, there is the ability for the development to lead to more customer satisfaction and better recommendations from employees (Palmatier et al, 2006, pg. 136). The multiple market which is affected by relationship building can be altered in a positive manner, specifically by looking into the internal marketing approach. To do this effectively, the origin, nature and scope of the environment has to be looked into, combined with direct changes and actions that are based on providing loyalty, trust and satisfaction with relationship building (Varey, Lewis, 1998: pg. 926). While looking at the different concepts of relationship marketing through internal concepts is the need to begin to establish what is occurring through strategy. The strategy development is one which is inclusive of the ability to change the functions within the internal organization as well as in terms of customer relationship management. The overall objective is to add in value through the strategy while ensuring the long term relationships, value added services and trust is a part of the main objectives of the corporation. An approach used with this theory is the cross functional model. This develops customer relationship management platforms as well as management that can be used with different forms of relationships. Since there are several different levels of relationships which occur within the workplace, the ability to meet these specific objectives becomes essential to creating the right types of relationships. The cross functional model examines the different types of relationships which form as a part of the internal environment then creates a specific way for the strategies to be established in regards to the relationships that are established among those that are in the internal organization (Payne, Frow, 2006: pg. 135). A specific part of the strategy which can be focused on is the relationships that are established among stakeholder groups. There is the need to develop and extend the relationships to these groups, specifically because of the investments which are provided by stakeholders as well as the expectations which are associated with the corporation (Gummesson, 2008, pg 152). An example of how this can be established is through the six markets model, which interrelates several different elements for relationship planning including value propositions, value delivery design, stakeholder relationship marketing plans and measurement and feedback. The relationships that are established through networks and which create a stronger sense of opportunity for stakeholders are then able to provide more action to those interested in the corporation. The strategy of incorporating stakeholders into the main relationship building process then becomes essential for those that are interested in creating a sense of growing a market with urgency and immediacy (Payne, Ballantyne, Christopher, 2004: pg. 856). The objective which is required with stakeholder groups is based on the ability to build maximum value through the stakeholders, create stronger objectives within the corporation and to combine the different elements of relationship building with the stakeholders. There needs to be methods which are incorporated into this which evaluate the performance of the company, specifically which intertwines the internal market with the criteria of the company and the long term objectives of the corporation (Jensen, 2010, pg.17). As this is performed, there is the ability to reach more value among the corporation while providing more consistent goals within the organization. More important, one type of performance which is evaluated can directly affect the other elements which are associated with the company (Jensen, 2010, pg. 17). Case: Starbucks Starbucks began in 1981 by Howard Schultz after noticing the small coffee shop in Seattle. Schultz became interested in the historical setting and became associated with the Pikes Peak marketplace shop. He then decided to further the innovations of the coffee by studying the most popular coffees in the world in areas such as Italy. He took the atmosphere, taste of the coffee and overall concepts from the Italian baristas and added them into the overall Starbucks image. The mission of the company is to nurture and inspire the human spirit through the coffee and by offering the store in several areas. Today, the store is located in over 50 countries and has more than 15,000 stores that offer the coffee to those that are interested in trying to find the perfect cup of coffee. The corporation is also strong with the ethical compliance that ensures fair treatment of all employees while ensuring that all employees have a specific level of conduct when working for the corporation (Starbucks, 2011). The examination of the particular attributes of Starbucks then leads to other understandings that are attributed with the company. One of the most important aspects that is a part of the corporation is the stakeholder value that continues to drive the specific corporation forward and which establishes a strong reputation on a global level (Starbucks, 2011). Problem While Starbucks has created specific relationship building factors and marketing objectives, there is a lack of communication and opportunity available for stakeholders. This is specific to the fast growth of the company as well as the inability for the relationship building to take place outside of the corporate system which has developed. The evaluation of Starbucks will determine what needs to be done to incorporate the stakeholders into the overall objectives of the company. There are several stakeholders and investors which are directly linked with Starbucks. However, monitoring and strategically placing a plan for trust, loyalty and long term relationships with the different stakeholders can further determine the success of the corporation (Gummesson, 2008, pg 152). More important, the stakeholder relationships will affect the internal organization, functions within the company and will then result in stronger relationships that are associated with the general public. By focusing on a strategic plan which can be implemented for the stakeholders of Starbucks, there is the ability to reach to different components of the Starbucks Company. Both IESO, a stakeholder group which is focused on providing specific types of endorsements, and the Joint and Common Market have specific objectives. However, these can be reached through Starbucks by focusing on an internal strategic plan for the corporation (Murphy et al, 2005, pg. 1049). Strategy Used A stakeholder group which is able to define specific objectives is the Joint and Common Stakeholders Working Group. This particular group includes a set of individuals that are known for investing in various corporations that provide more working stability to the nation. Different phases are noted with the implementation of the group as well as strategic actions which allow investors to specifically invest in various components. Joint stakeholder agreements, monitoring of the market flow and ensuring that there is a sense of consistency with the objectives has led to the overall agenda of the corporation and allows each of the stakeholders to meet different objectives with the working group (Joint and Common Market, 2011). The second stakeholder group which will be used IESO market group. The particular focus of this group differs, specifically because the objective is based on providing support for the market as well as for those that are learning to excel in different areas of the market (IESO, 2010). The group has built different objectives based on this, as well as enhancing those that are in a given region. The main group is in Europe and is known nationally for contributing to different concepts, such as electricity. By doing this, there is the ability to move some of the suggestions into the public while working closely with those who are interested in the stakeholder investments and ideas (IESO, 2010). Both of these stakeholder groups differ in their objectives and focus for investing in a specific company. The main objective of Starbucks is to find an alternative to meeting the needs of both that are involved in these groups. Understanding how to link to the different markets and theories as well as finding a way to identify the stakeholder group objectives through relationship building can then provide a stronger objective. To begin this, Starbucks will need to reexamine the internal organization first. The use of the cross functional model can be used to identify the specific objectives and needs of the corporation (Ryals, 2001, pg. 534). This will identify several areas that need to be re-examined for stronger communication and relationships. More important, it can meet the objectives of both groups by cross examining the company and identifying a way to provide the correct communications to both corporations. Issues with Strategy While the stakeholder groups can be examined within the organization, this is limited to the public amount of knowledge that is available about stakeholder relationships to Starbucks. More important, the communication and relationships which are required for the examination of the stakeholder groups is not available specifically through the stakeholder objectives and is limited by the amount of knowledge made through public access. More important, the internal organization which will be studied and re-examined only provides a theoretical examination of how the Starbucks relationships can change with high levels of risk in understanding the value of how the relationships may change (Ryals, 2001, pg. 534). Approach The most important component of this particular strategy is to identify the levels of communication that need to be provided to both stakeholder groups. This will determine how many objectives are reached with the changes in Starbucks. More important, it will help each to interrelate the communication with open information. This will create a stronger sense of trust and loyalty between the stakeholders and the objectives which Starbucks holds. More important, there will be the ability to cross this information to other arenas, such as marketing that can directly affect the customers which are a part of the corporation as well as individuals which are directly involved with the concepts that are a part of the stakeholder group. By identifying the several levels of communication, there will be the ability to not only affect stakeholders, but also to examine exactly what is needed with the objectives that are a part of the corporation. By doing this, there is the ability to create a different relationship with those that are interested in the organization while providing stronger communication at all levels (Bruhn, 2001, pg. 9). Another strategy which Starbucks can implement that will provide them with stronger levels of communication to both groups is to offer the Six Level Model to the stakeholders. This doesn’t focus on stakeholders, but instead looks at others that are related directly to the working area. The internal structure, which is inclusive of employees as well as those which supply the company will first be considered. Heightening the communication among these individuals, providing higher levels of satisfaction and offering more ways to look into customer relationship management will change the way in which most focus on the company. In return, the customer added value will build with relationships and strong amounts of loyalty and trust with the company. The result will be a higher interest in the company as well as increased amounts of services (Gruen et al, 2000, 34). When stakeholders are able to see the rise of this specific value, there is also the ability to respond with greater interest of connecting to the Starbucks line and investing in both the marketing portion as well as the working options. Starbucks will then need to apply tactics in terms of communication, specifically which links back to the working environment and which carries forward with the model to ensure that there are several components which are interlinked with each other in the group and which move to the stakeholder value which is created (Gruen et al, 2000, 34). Tactics For Starbucks to implement the necessary changes for the company is also the need to change the internal organization. Ensuring that those who are working within the company receive several benefits and are able to provide better customer service management ensures that marketing as well as relationships are well established. The more in which the trust and loyalty is built, the easier it is for stakeholders to respond in a positive manner (Chiu et al, 2005, 1081). More important, there is the ability to implement and alter the needs within the organization while providing more insight for the stakeholders. The established relationship with the stakeholders then becomes essential to the overall growth of the company as well as the continuous relationships which can be established (Gummesson, 2008, 17). The ability for the stakeholders to respond in a positive way is not only dependent on the internal environment but also on the way that the stakeholders respond to the communication. Starbucks can provide more information to those investing in the company, specifically which will build trust and loyalty while showing sustainable growth within the corporation. As this is done, the stakeholders will be able to invest more in the company and will have a stronger sense of interdependence with the corporation (Gummesson, 2008, 57). Starbucks can initialize more than the current investor relations which are dependent on the financial growth and reports that occur once a year. More important, continuous communication, news updates, connections to the internal organization and noted changes that are a part of the corporation can all be initialized to change the overall understanding that stakeholder groups have toward Starbucks as well as the interest in remaining loyal while assisting the company in continuous growth (Bruhn, 2001, 17). Conclusion Developing strong relationships with different groups of individuals is interdependent, specifically through several dimensions that combine the individuals together. More important, there is an established connection that is required for companies to begin to be efficient in their business. The link between the different relationships is one that is directly affected at all levels and which alters the way in which individuals interact with each other (Bruhn, 2001, 18). Understanding how this works as well as recognizing how to strategically implement further relationships can help a business to work toward growth within the corporation. The example of Starbucks shows that the continuous movement toward a stronger internal organization as well as the establishment of relationships and communication with stakeholders can continuously affect the growth of the corporation while ensuring that there are various ways of reaching effective loyalty and trust among those that are interested in the corporation. References Bhattacharya, C.B., Michael Ahearne, Thomas Gruen. (2005). “Antecedents and Consequences of Customer Company Identification: Expanding the Role of Relationship Marketing.” Journal of Applied Psychology 90 (3). Bruhn, Manfred. (2003). Relationship Marketing: Management of Customer Experiences. New York: Prentice Hall. Chiu, HC, YC Ching Hsieh, Yu Chuan Li, Monle Lee. 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